If you’re considering filing for bankruptcy, you’re far from alone. Many people might not realize just how common bankruptcy is for individuals, but thousands of people do this every year to help themselves get out of debt. Bankruptcy can sometimes seem like a negative thing, but debt can happen to everyone, and in many cases, this is a person’s best option for getting debt-free. While bankruptcy can be a chance at a fresh start, it does come with a few downsides.
To see if bankruptcy is right for you, you’ll need to weigh the costs and benefits of bankruptcy to see if it’s worth it for your situation.
Costs
It Costs Money
While you’re filing bankruptcy to help improve your financial situation, it can also have a negative impact. Filing for bankruptcy isn’t free, so you’ll need to have the means to cover this. On top of the filing fees, you’ll also need to consider the cost of working with an attorney.
It Affects Your Credit
If you file for Chapter 7 bankruptcy, it will show up on your credit for ten years, while Chapter 13 will be on it for seven years. This might hurt you going forward, and you may have to give up your credit cards as well. Of course, a large amount of debt also affects your credit, so many are willing to have a bankruptcy on their credit if it gets them out of debt.
Not All Debts Can Be Discharged
Bankruptcy isn’t meant for everyone because it only allows you to discharge certain debts, not all of them. Bankruptcy won’t help if you have debts such as student loan debt, alimony, child support, and some tax debts.
Benefits
You Won’t Hear From Debt Collectors
If calls and letters from debt collectors have gotten overwhelming, bankruptcy might be a good option. This happens to many people when they’re in debt, and it can be highly stressful, but bankruptcy can help stop it. When you file for bankruptcy, it prevents creditors from contacting you to get a break from this.
Stop Wage Garnishments
Wage garnishments can make life even harder when you’re already struggling. It may be time to file for bankruptcy for those who can’t afford the amount being taken from their wages to pay for their debts. Filing for bankruptcy will stop creditors from garnishing your wages or your bank account.
Save Your Home From Foreclosure
Facing possible foreclosure is why many people file for bankruptcy. Filing For bankruptcy can help put off foreclosure for a little while. If you want to keep your home, bankruptcy could be worth it.
Find Out if Bankruptcy is Right for You
There’s a lot to consider if you’re thinking about filing for bankruptcy. While doing your research is important, you might still be wondering if bankruptcy is worth it for you. To know for certain, it can help if you speak with a professional who knows the ins and outs of bankruptcy and can help steer you in the right direction. At JJPLaw, you can get a free consultation with one of the top attorneys in Wilkes-Barre, PA, to see if the benefits of bankruptcy outweigh the costs for you.
Contact us to learn more about filing for bankruptcy and how it could help.
